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©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 1 ©2017 Coupa Software, Inc. – Confidential – All Rights Reserved
CLOUD PLATFORM FOR BUSINESS SPEND
September 6, 2017
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 2
SAFE HARBOR STATEMENT
This presentation and the accompanying oral presentation include forward-looking statements. We intend for such forward‐looking statements to be covered by the safe harbor provisions for forward‐looking statements contained in the U.S. Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts, including statements regarding our future results of operations and financial position, customer lifetime value, strategy and plans, market size and opportunity, competitive position, industry environment, potential growth opportunities, business model, benefits from acquisitions, products and product capabilities and our expectations for future operations, are forward-looking statements. Forward‐looking statements can be identified by terms such as “anticipate”, “believe”, “estimates”, “targets”, “projects”, “could”, “ expect”, “seeks”, “intend”, “may,” “plan”, “predict”, “potential”, “prospects”, “should”, “will”, “would” or similar expressions and the negatives of those terms, although not all forward‐looking statements contain these identifying words. We have based these forward-looking statements on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, strategy, short- and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in “Risk Factors” in our most recently filed Form 10-K or 10-Q, which is available at www.investors.coupa.com and on the SEC’s website at www.sec.gov. We operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this presentation may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, except as required by law, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. Forward-looking statements represent our management’s beliefs and assumptions only as of the date of this presentation. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this presentation to conform these statements to actual results or to changes in our expectations. In addition to U.S. GAAP financials, this presentation includes certain non-GAAP financial measures. These non-GAAP measures are in addition to, not a substitute for or superior to, measures of financial performance prepared in accordance with U.S. GAAP. A reconciliation of historical non-GAAP measures to historical GAAP measures is contained in the Appendix. Coupa is not able, at this time, to provide a GAAP to non-GAAP reconciliation for certain business model measures because of the difficulty of estimating certain items excluded from these non-GAAP measures that cannot be reasonably predicted, such as charges related to stock-based compensation expense. The effect of these excluded items may be significant.
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 3 ©2017 Coupa Software, Inc. – Confidential – All Rights Reserved
ROB BERNSHTEYN CHIEF EXECUTIVE OFFICER
3
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 4
WHAT SALESFORCE IS TO SALES, COUPA IS TO SPEND
SALES Marketing
Services
Support
Web
Platform
SPEND Procurement
Invoice
Expenses
Sourcing
Inventory
Platform
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 5
COUPA PROVIDES VISIBILITY TO ALL YOUR BUSINESS SPEND
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 6
BREADTH OF CUSTOMERS
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UNIFIED PLATFORM ELIMINATES NEED FOR FRAGMENTED SYSTEMS
h SOURCING SUPPLIER
CATALOGS PROCUREMENT INVENTORY SUPPLIER
MANAGEMENT CONTRACTS
EXPENSE MANAGEMENT
INVOICING
ANALYTICS
LEGACY SILOED APPROACH
INVENTORY CONTRACTS SOURCING ANALYTICS
EXPENSE MANAGEMENT
INVOICING
SUPPLIER MANAGEMENT
STOREFRONT
UNIFIED PLATFORM
PROCUREMENT
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COUPA INVESTMENT HIGHLIGHTS
LARGE ADDRESSABLE MARKET
ATTRACTIVE FINANCIAL MODEL
DISRUPTIVE CLOUD PLATFORM
RAPID PLATFORM ADOPTION
Measurable Business Value
Unified Platform
Adoption by All
$16.8Bn Market Opportunity
$500Bn+ Cumulative Spend Under Management
1.5MM+ Licensed Users
3MM+ Suppliers
$159MM LTM Revenue
45% LTM YoY Revenue Growth
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 9
COMPREHENSIVE USER-CENTRIC ACCELERATED
OPEN PRESCRIPTIVE
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 10 *Savings is an estimate based on industry b h k
CUSTOMERS ACHIEVE MEASURABLE BUSINESS VALUE Note: Savings numbers are an estimate based on industry benchmarks
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 11
UNIFIED CLOUD PLATFORM FOR BUSINESS SPEND
3MM+ SUPPLIERS 530+ CUSTOMERS* 1.5MM+ LICENSED
USERS*
$18Bn+ OF SAVINGS
TO DATE
$500Bn+ CUMULATIVE
SPEND UNDER MANAGEMENT
100+ COUNTRIES
20 LANGUAGES
* Figures as at January 31, 2017.
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 12
CONSUMERIZED BUSINESS EXPERIENCES DRIVE ADOPTION
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 13
DESIGNED FOR CONNECTIVITY AND INTEROPERABILITY
SAN
cXML Digital Scan
CSP
EDI
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 14
TRADE EXTENSIONS ACQUISITION ADDS STRATEGIC SOURCING CAPABILITIES
• Well established provider of Strategic Sourcing and Optimization software; handling some of the world’s largest sourcing events
• Global customers across verticals such
as manufacturing and retail
PROFILE
Manufacturing Asset Optimization
Construction Projects
Transportation & Logistics
Facilities Management Fresh
Produce
Raw Materials
Temp Labor
Goods for Resale
Chemical Feedstocks
CO
MPL
EXIT
Y
STRATEGIC IMPORTANCE
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 15
TRADE EXTENSIONS ACQUISITION ALIGNED TO COUPA GROWTH DRIVERS
Expand Global Customer Base
Increase Direct Spend Under Management
Complex event handling for strategic supply chain events from
logistics to raw materials.
Standalone sourcing opportunities at global businesses running
non-Coupa systems.
Continue to Innovate & Further Develop Our Platform
Solidifies market leadership position with deep capabilities
for strategic sourcing.
Deepen Existing Customer Relationships
Upsell opportunities across Coupa and Trade Extensions
customer bases.
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 16
Note: We calculate the lifetime value of our customers and associated customer acquisition costs for a particular year by comparing (1) gross profit from net new subscription revenues for the year multiplied by the inverse of the estimated subscription renewal rate to (2) total sales and marketing expense incurred in the preceding year
CONTINUED PROGRESS AGAINST KEY METRICS AND RECENT WINS
Recent Customer and Partnership Wins
Q2 2017 Q2 2018 Q2 2017 Q2 2018
>$255Bn >$500Bn LTM Revenue $109MM $159MM
>$8Bn >$18Bn Non-GAAP Gross Margin 65% 71%
Cumulative Spend Under Management
Savings to Date
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 17
LARGE MARKET OPPORTUNITY
$4.5Bn
$2.7Bn
$9.6Bn $16.8Bn
TOTAL SUPPLY CHAIN MANAGEMENT (1)
EXPENSE MANAGEMENT (2)
PROCUREMENT (1)
2017 ANALYST ESTIMATED MARKET
(1) International Data Corporation, Worldwide Semiannual Software Tracker, November 2016 (2) Technavio market research sourced from ISI Securities EMIS, Global SaaS-based Expense Management Market, December 2013
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 18
STRATEGIC EXTENSION TO ANY ERP
Sales Marketing
Service Customer Self Service
Social
Field Service
IT Helpdesk
Facilities Mgmt
Talent
HRMS Perfor- mance
Payroll Employee
Self Service
FRONT OFFICE BACK OFFICE
Supplier Manage-
ment
Inventory Services
Procurement OCR
Contracts
Sourcing
Compliance
Request Mgmt
Contract Authoring
Storefront
Portal
Suppliers
INVOICING
PROCUREMENT
EXPENSES
Benefits
CRM
HCM SERVICE MANAGEMENT
ERP
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 19
STRATEGIC EXTENSION TO ANY ERP
FRONT OFFICE BACK OFFICE
CRM
SERVICE MANAGEMENT
HCM
ERP
PROCURE
INVOICE
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 20
YEARS OF INDUSTRY VALIDATION
2015
TRAVEL AND EXPENSE MANAGEMENT NAVIGATOR
2
3
4
5
6
7
8
9
10
4.5 5.5 6.5 7.5 8.5 9.5
PR
OFI
CIE
NC
Y
ADAPTABILITY
CERTIFY
EXPENSIFY EXPENSE WATCH
INTERPLX
COUPA
DATABASICS INFOR
APPTRICITY
SUTISOFT CONCUR CHROME RIVER
LEADER WITH THE HIGHEST PROFICIENCY
2016
MAGIC QUADRANT FOR PROCURE TO PAY SUITES
LEADER WITH HIGHEST ABILITY TO EXECUTE
2017
THE FORRESTER WAVE™: EPROCUREMENT
HIGHEST RATING IN CURRENT OFFERING & STRATEGY
20
…AN IMPRESSIVE TRACK RECORD FOR INNOVATION, A STRONG BRAND AND A SUCCESSFUL SYSTEM INTEGRATOR STRATEGY.
“ “ …OFFERS A FULL EXPENSE MANAGEMENT PLATFORM WITH INGENUITY & DESIRE FOR INNOVATION.
“ “ …LIBRARY OF CUSTOMERS DESCRIBING MEASURABLE BENEFITS FROM USING COUPA IS TESTAMENT TO ITS PRODUCT AND ITS APPROACH.
“ “
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 21
BEST OF BOTH WORLDS PARTNERSHIP
Open Marketplace +
Enterprise Control
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 22
CUSTOMER SUCCESS FRAMEWORK DRIVES EXCEPTIONAL TIME TO VALUE
Value Optimization
$6MM of savings in following 12 months, leads to run rate of
$10MM in annual savings
Identification of $70MM in potential future savings results in decision to add users and additional modules
Value Realization
93% improvement in on-contract spending leads
to savings of $4MM
Project delivers 8% reduction in spending in remote locations via
visibility and rejections
Value Discovery
CFO discovers that only 26% of spending is done on-contract
Organization needs control over spending in remote locations
Sample Customer
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 23
TYPES OF PRESCRIPTIVE INTELLIGENCE
Application Intelligence Suite Synergy Intelligence Community Intelligence
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 24
NETWORK EFFECTS CREATE BARRIERS TO ENTRY
COMMUNITY INTELLIGENCE
METHOD, SYSTEM AND APPARATUS FOR E-MAIL REQUISITIONING
SHOPPING AT E-COMMERCE SITES WITHIN A BUSINESS PROCUREMENT APPLICATION
PATENTED POLICY SYSTEM FOR E-PROCUREMENT
PATENTED PATENTED PATENTED FEEDBACK VALIDATION OF ELECTRONICALLY GENERATED FORMS
AGGREGATE SPEND
LEVERAGE
$500Bn+ CUMULATIVE
SPEND UNDER MANAGEMENT
SUPPLIER NETWORK
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 25
EXTENSIVE PARTNER ECOSYSTEM
Mid
-Mar
ket
Belo
w $
1Bn
Ente
rpris
e Ab
ove
$1Bn
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 26
GROWTH DRIVERS
Expand Global Customer Base
Continue to Innovate & Further Develop Our Platform
Further Develop & Expand Our Partner Ecosystem
Increase Direct Spend Under Management
Deepen Existing Customer Relationships
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 27
STRONG LEADERSHIP TEAM WITH DIVERSE EXPERIENCE
CHANDAR PATTABHIRAM CHIEF MARKETING
OFFICER
JP KRISHNAMOORTHY SVP,
ENGINEERING
JON STUEVE VP &
GENERAL COUNSEL
RAY MARTINELLI EVP,
PEOPLE
ROB BERNSHTEYN CHIEF EXECUTIVE OFFICER, CHAIRMAN OF THE BOARD
TODD FORD CHIEF FINANCIAL
OFFICER
RAJA HAMMOUD SVP, PRODUCT MANAGEMENT
DAVID WILLIAMS VP,
TECHNOLOGY
ROGER GOULART SVP, BUSINESS
DEVELOPMENT & ALLIANCES
RAVI THAKUR SVP, CUSTOMER
SUCCESS AND SERVICE DELIVERY
STEVE WINTER CHIEF REVENUE
OFFICER
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 28
CORE VALUES
ENSURE CUSTOMER SUCCESS
FOCUS ON RESULTS
STRIVE FOR EXCELLENCE
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 29 ©2017 Coupa Software, Inc. – Confidential – All Rights Reserved
TODD FORD CHIEF FINANCIAL OFFICER
29
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 30
FINANCIAL HIGHLIGHTS
STRONG REVENUE GROWTH
RECURRING SUBSCRIPTION REVENUE MODEL WITH HIGH VISIBILITY
CONSISTENT COHORT SPENDING WITH HIGH PROFITABILITY
COMPELLING UNIT ECONOMICS DEMONSTRATE POWERFUL BUSINESS MODEL
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 31
RAPIDLY INCREASING CUMULATIVE SPEND UNDER MANAGEMENT
$3 $7 $23 $57
$110
$190
>$255
>$500
FY11 FY12 FY13 FY14 FY15 FY16 FY17Q2 FY18Q2
CUMULATIVE SPEND UNDER MANAGEMENT ($Bn)
>$245Bn processed in last twelve months
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 32
PRICING MODEL IS ALIGNED TO BUSINESS VALUE AND SIMPLE TO UNDERSTAND
Pricing Components
3
Employees Users Applications
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 33
RAPID REVENUE GROWTH
85%
90%
88%
15%
10%
12%
$51
$84
$134
FY15 FY16 FY17
$21 $23
$25 $28
$31 $34
$36
FQ3'16 FQ4'16 FQ1'17 FQ2'17 FQ3'17 FQ4'17 FQ1'18 FQ2'18
62% CAGR
Subscription Services Professional Services
HISTORICAL ANNUAL REVENUE ($MM) HISTORICAL QUARTERLY SUBSCRIPTION SERVICES REVENUE ($MM)
44% YoY
Growth
$40
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 34
COHORT DATA DEMONSTRATES POWERFUL BUSINESS MODEL
$4.0 $9.9 $10.0 $10.1 $11.6
($14.0)
($2.5) ($2.5) ($2.6) ($2.9)
(249%)
75% 75% 74% 75%
FY13 FY14 FY15 FY16 FY17
CUSTOMER COHORT CONTRIBUTION MARGINS ($MM)
Contribution Margin Subscription Revenue Variable Costs
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 35
COMPELLING UNIT ECONOMICS
$1
>$6
CUSTOMER ACQUISITION COST LIFETIME VALUE
LTV/ CAC
Note 1: LTV/CAC was reported for the period ending FY17; Updates to this metric are expected to be provided on an annual basis Note 2: We calculate the lifetime value of our customers and associated customer acquisition costs for a particular year by comparing (1) gross profit from net new subscription revenues for the year multiplied by the inverse of the estimated subscription renewal rate to (2) total sales and marketing expense incurred in the preceding year
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 36
GROSS MARGINS (NON-GAAP)
76% 77%
80% 80% 78%
80% 81%
82% 80% 81%
(68%) (104%) (89%) (59%) (53%) (5%) (5%)
10%
(9%) FQ1'16 FQ2'16 FQ3'16 FQ4'16 FQ1'17 FQ2'17 FQ3'17 FQ4'17 FQ1'18 FQ2'18
QUARTERLY GROSS MARGIN TRENDS(1)(2)
► FQ2’18 Professional Services & Other margins weighed by headwinds as revenue recognition transitions from customer go-lives
► Professional Services margins should stabilize with transition to revenue recognition as services are delivered
► Continued investments in Professional Services partner ecosystem
CONSIDERATIONS
Subscription Services Gross Margin Prof. Services & Other Gross Margin Total Gross Margin
(1) For a reconciliation of GAAP to Non-GAAP metrics, refer to the Appendix (2) Bar chart represents gross profit dollar amounts while data labels refer to gross margins
62% 64%
65% 64%
60% 65%
69%
73%
(60%)
71% 71%
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 37
BUSINESS MODEL TO PROVIDE OPERATING LEVERAGE (NON-GAAP(1))
(1) For a reconciliation of GAAP to Non-GAAP metrics, refer to the Appendix (2) FCF stands for free cash flow, which is generally calculated as cash flow from operating activities plus cash flow from investing activities. The Company excludes the impact of acquisitions when reporting FCF. *These measures are forward-looking; are subject to significant business, economic, regulatory and competitive uncertainties and contingencies, many of which are beyond the control of the Company and its management; and are based upon assumptions with respect to future decisions, which are subject to change. Actual results will vary and those variations may be material. For discussion of some of the important factors that could cause these variations, please consult the “Risk Factors” section in our most recently filed Form 10-K or 10-Q. Nothing in this presentation should be regarded as a representation by any person that these measures will be achieved and the Company undertakes no duty to update these measures.
FY17 FQ2’18 MID-TERM* LONG-TERM*
Gross Margin 67% 71% 68-70% 75-80%
R&D as % of Revenue 21% 20% 18-21% 12-15%
S&M as % of Revenue 49% 48% 47-50% 35-40%
G&A as % of Revenue 16% 16% 11-13% 7-10%
Operating Margin (19%) (13%) (10-20%) 20%+
FCF Margin(2) (19%) 18%; (1%) TTM 0-5% 20%+
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 38
COUPA: LEADING THE CLOUD REVOLUTION IN BUSINESS SPEND MANAGEMENT
38
SP
EN
D M
AN
AG
EM
EN
T E
RP
C
RM
H
CM
True Cloud Software-as-a-Service Companies Becoming Mainstream
1990s
TODAY
1980s
2000s
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 39
CLOUD PLATFORM FOR BUSINESS SPEND
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 40 ©2017 Coupa Software, Inc. – Confidential – All Rights Reserved
APPENDIX
40
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 41
GAAP TO NON-GAAP RECONCILIATION
Q1 FY'17 Q2 FY'17 Q3 FY'17 Q4 FY'17 Q1 FY'18 Q2 FY'18 FY 2017Subscription Revenue $25,372 $27,783 $30,799 $33,834 $35,664 $39,764 $117,788Professional Services Revenue $3,811 $3,349 $4,643 $4,184 $5,473 $4,787 $15,987Total Revenue $29,183 $31,132 $35,442 $38,018 $41,137 $44,551 $133,775
GAAP Subscription COGS $6,050 $6,029 $6,346 $6,630 $7,996 $9,025 $25,055Amortization of acquired intangible assets $221 $212 $212 $308 $486 $788 $953Share-based compensation expense $125 $140 $150 $300 $355 $529 $715Non-GAAP Subscription COGS $5,704 $5,677 $5,984 $6,022 $7,155 $7,708 $23,387
GAAP Subscription Gross Profit $19,322 $21,754 $24,453 $27,204 $27,668 $30,739 $92,733% Margin 76% 78% 79% 80% 78% 77% 79%
Non-GAAP Subscription Gross Profit $19,668 $22,106 $24,815 $27,812 $28,509 $32,056 $94,401% Margin 78% 80% 81% 82% 80% 81% 80%
GAAP Professional Services COGS $5,968 $5,452 $5,031 $4,763 $5,501 $5,923 $21,214Share-based compensation expense $135 $109 $155 $373 $563 $716 $772Non-GAAP Professional Services COGS $5,833 $5,343 $4,876 $4,390 $4,938 $5,207 $20,442
GAAP Professional Services Gross Profit ($2,157) ($2,103) ($388) ($579) ($28) ($1,136) ($5,227)% Margin (57%) (63%) (8%) (14%) (1%) (24%) (33%)
Non-GAAP Professional Services Gross Profit ($2,022) ($1,994) ($233) ($206) $536 ($420) ($4,455)% Margin (53%) (60%) (5%) (5%) 10% (9%) (28%)
GAAP Total Gross Profit $17,165 $19,651 $24,065 $26,625 $27,640 $29,603 $87,506% Margin 59% 63% 68% 70% 67% 66% 65%
Non-GAAP Total Gross Profit $17,646 $20,112 $24,582 $27,606 $29,044 $31,636 $89,946% Margin 60% 65% 69% 73% 71% 71% 67%
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 42
GAAP TO NON-GAAP RECONCILIATION (CONT’D)
* Free cash flow is generally calculated as cash flow from operating activities plus cash flow from investing activities. As illustrated above, the Company excludes the impact of acquisitions when reporting free cash flow.
Q1 FY'17 Q2 FY'17 Q3 FY'17 Q4 FY'17 Q1 FY'18 Q2 FY'18 FY 2017GAAP Research & Development $7,840 $7,206 $7,179 $8,037 $9,171 $10,720 $30,262Amortization of acquired intangible assets $0 $0 $0 $0 $0 $0 $0Share-based compensation expense $322 $303 $357 $784 $1,152 $1,647 $1,766Non-GAAP R&D expenses $7,518 $6,903 $6,822 $7,253 $8,019 $9,073 $28,496
% of Revenue 26% 22% 19% 19% 19% 20% 21%
GAAP Sales & Marketing $15,836 $19,252 $16,315 $17,159 $20,679 $23,812 $68,562Amortization of acquired intangible assets $0 $0 $0 $0 $0 $189 $0Share-based compensation expense $471 $441 $937 $1,282 $1,600 $2,340 $3,131Non-GAAP S&M expenses $15,365 $18,811 $15,378 $15,877 $19,079 $21,283 $65,431
% of Revenue 53% 60% 43% 42% 46% 48% 49%
GAAP General & Administrative $5,553 $4,620 $6,068 $7,865 $8,177 $9,430 $24,106Litigation-related costs $123 $26 $1 $0 $0 $0 $150Share-based compensation expense $653 $566 $785 $1,064 $1,607 $2,406 $3,068Non-GAAP G&A expenses $4,777 $4,028 $5,282 $6,801 $6,570 $7,024 $20,888
% of Revenue 16% 13% 15% 18% 16% 16% 16%
GAAP Operating Profit ($12,064) ($11,427) ($5,497) ($6,436) ($10,387) ($14,359) ($35,424)% Margin (41%) (37%) (16%) (17%) (25%) (32%) (26%)
Non-GAAP Operating Profit ($10,014) ($9,630) ($2,900) ($2,325) ($4,624) ($5,743) ($24,869)% Margin (34%) (31%) (8%) (6%) (11%) (13%) (19%)
Operating Cash Flows (10,226) 2,507 (2,825) (10,411) 7,160 9,178 (20,955) Investing Cash Flows (1,386) (1,070) (1,044) (7,741) (1,353) (40,038) (11,241) Less: Acquisitions - - - (6,750) (140) (38,933) (6,750)
Free Cash Flow (FCF)* (11,612) 1,437 (3,869) (11,402) 5,947 8,073 (25,446) % Margin (40%) 5% (11%) (30%) 14% 18% (19%)
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 43
GAAP TO NON-GAAP RECONCILIATION (CONT’D)
Q1 FY'16 Q2 FY'16 Q3 FY'16 Q4 FY'16Subscription Revenue $14,289 $17,333 $20,757 $23,288Professional Services Revenue $1,520 $1,371 $2,044 $3,076Total Revenue $15,809 $18,704 $22,801 $26,364
GAAP Subscription COGS $3,550 $3,995 $4,280 $4,979Amortization of acquired intangible assets $13 $13 $14 $347Share-based compensation expense $45 $54 $62 $74Non-GAAP Subscription COGS $3,492 $3,928 $4,204 $4,558
GAAP Subscription Gross Profit $10,739 $13,338 $16,477 $18,309% Margin 75% 77% 79% 79%
Non-GAAP Subscription Gross Profit $10,797 $13,405 $16,553 $18,730% Margin 76% 77% 80% 80%
GAAP Professional Services COGS $2,594 $3,639 $3,914 $4,960Share-based compensation expense $45 $840 $59 $70Non-GAAP Professional Services COGS $2,549 $2,799 $3,855 $4,890
GAAP Professional Services Gross Profit ($1,074) ($2,268) ($1,870) ($1,884)% Margin (71%) (165%) (91%) (61%)
Non-GAAP Professional Services Gross Profit ($1,029) ($1,428) ($1,811) ($1,814)% Margin (68%) (104%) (89%) (59%)
GAAP Total Gross Profit $9,665 $11,070 $14,607 $16,425% Margin 61% 59% 64% 62%
Non-GAAP Total Gross Profit $9,768 $11,977 $14,742 $16,916% Margin 62% 64% 65% 64%
©2017 Coupa Software, Inc. – Confidential – All Rights Reserved 44
GAAP TO NON-GAAP RECONCILIATION (CONT’D)
Q1 FY'16 Q2 FY'16 Q3 FY'16 Q4 FY'16GAAP Research & Development $4,431 $5,792 $5,965 $6,579Amortization of acquired intangible assets $0 $53 $105 ($158)Share-based compensation expense $107 $750 $152 $227Non-GAAP R&D expenses $4,324 $4,989 $5,708 $6,510
% of Revenue 27% 27% 25% 25%
GAAP Sales & Marketing $10,679 $13,532 $14,306 $16,196Share-based compensation expense $176 $210 $706 $255Non-GAAP S&M expenses $10,503 $13,322 $13,600 $15,941
% of Revenue 66% 71% 60% 60%
GAAP General & Administrative $2,480 $8,719 $3,709 $4,632Litigation-related costs $642 $848 $327 $126Share-based compensation expense $186 $5,620 $547 $383Non-GAAP G&A expenses $1,652 $2,251 $2,835 $4,123
% of Revenue 10% 12% 12% 16%
GAAP Operating Profit ($7,925) ($16,973) ($9,373) ($10,982)% Margin (50%) (91%) (41%) (42%)
Non-GAAP Operating Profit ($6,711) ($8,585) ($7,401) ($9,658)% Margin (42%) (46%) (32%) (37%)